Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Krys Tully from Tully First National Real Estate expects the South Lake property market to moderate for the remainder of 2011, on the back of a falling market over the first half of the year as a result of sellers having a more realistic expectation of market values. This is a case of the market self-correcting from a very sharp rise experienced in the last 12 months,” Ms Tully said in the First National Property Market Outlook Mid Year Update released this week. “This created an over-supply of houses providing buyers, especially investors, more choice and the ability to make offers to where they could get the best buy. In the main, property prices across the board (house, apartment/strata and land) are expected to flatten, with any movements kept to below 1 per cent. “There is still an over-supply of houses and apartment/strata properties with inflated prices, although there are mainly single residential homes in the local area and apartment/strata make up a very minor percentage,” Ms Tully said. “Land is not in high demand due to buyers seeking better value in established homes.” Ms Tully believes the rental market will strengthen, with vacancy rates tightening, trending downwards and decreasing by between 1 and 5 per cent. “A shortage of supply of rental accommodation will put upwards pressure on weekly rentals which will increase by between 1 and 5 per cent,” Ms Tully said. According to the Outlook, investors are expected to represent the strongest growth in activity, increasing by between 1 and 5 per cent as a result of strong returns on investment and easing of bank lending criteria. Ms Tully said, “the state of Western Australia is experiencing a boom in mining, however this has not been reflected, yet, in the residential market, due to the current “buyer’s market” state of affairs. “The burgeoning resources boom and forecast population growth figures are expected to see the market rebound strongly in the coming years, although there
are still concerns about the Mining Tax, which has the potential to impact on the property market in the coming 6 to 12 months.” The Government’s move to introduce a carbon tax is not, in the main, supported by First National members. “However, more customers will seek energy efficient features when looking to buy a new home, due to the rising household energy costs and the challenge of maintaining a healthy home budget,” Ms Tully said. “Most people, especially many younger generation buyers are concerned about the planet and are committed to the global future.” Ms Tully considers Stamp Duty should be at least modified, if not abolished altogether, to stimulate market activity. “However, replacing Stamp Duty with another form of tax, such as a broad-based land tax or death duties should be completely quashed,” Ms Tully said. “And any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these policy changes from the recently announced WA state budget may be an indication that the Government does not intend to take such matters any further. - copy ends – Issued by: First National Real Estate. For further information or to receive a copy of the 2011 Property Outlook, Krys Tully from Tully First National Real Estate on 08 9417 1199